NMDC to set Rs10k cr steel plant, to declare JV partner by March

NMDC to set Rs10k cr steel plant, to declare JV partner by March

Mumbai: State-run NMDC plans to set up its second steel plant at an investment of Rs10,000 crore in Chhattisgarh and announce its partner for this joint venture by March.

“We will set up our second steel plant in Chhattisgarh with a capacity of two million tonnes per annum (MTPA). We will make a final announcement including the JV partner by the end of this fiscal," NMDC CMD Rana Som said without revealing the exact location and time-frame for completing the project.

National Mineral Development Corporation, which is the country’s largest public sector, is at present in talks with two companies for a suitable JV partner.

NMDC’s first integrated steel unit in Bastar district of Chhattisgarh is under construction and is expected to start production by early 2014. The estimated cost of the plant is Rs15,525-crore.

“We have already started construction work at the Bastar plant and hope to complete construction by December 2013. We will start production by early 2014," Som said, adding that the land acquisition process was concluded in a record 10 months.

The NMDC chairman said the company has also inked a pact with Russia’s Severstal for supply of coking coal to their proposed joint venture plant in Karnataka.

We have inked a Memorandum of Understanding (MoU) with Russia’s Severstal for supplying coking coal to our Karnataka plant. The Russian entity will provide it at a discounted price compared to the spot market,“ he said without disclosing the discount offered by the Russian firm.

“We are likely to sign an MoU with Severstal for our second plant in Chhattisgarh as well," Som added.

NMDC inked the pact with Severstal for the 5-million tonnes per annum joint venture steel plant in Karnataka last year.

“The plant will have an initial capacity of 2 MTPA, which is expandable to 5 MTPA," he said. The investment here is estimated at Rs25,000 crore.

Severstal will share its latest steel-making technology with NMDC for the venture, which will produce auto and electrical-grade steel.

At present, the Navratna firm produces about 30 MTPA of iron ore from three fully mechanised mines in Chhattisgarh and Karnataka.